The enterprise that was once in the number one position in the construction industry in Vietnam signed a contract to build a billion-dollar project of Lego. This is a positive signal for Coteccons after a long forgettable period.
Coteccons Construction Joint Stock Company (CTD) has just signed a contract with Lego Manufacturing Vietnam Co., Ltd (LMV) to build a Lego factory in Vietnam at VSIP III Industrial Park, Binh Duong.
As the general contractor, Coteccons will undertake all construction, structural, M&E and finishing works for subdivision 1-5 with a construction floor area of 163,000m².
Mr. Chris Senekki – Deputy General Director of Coteccons said, this is a very challenging project but a world-class project. The LMV factory will be Lego’s flagship office in terms of working experience, with a unique working environment and many humanistic values…
According to Lego Group’s representative, Mr. Preben ELNEF, Group Vice President and General Director of Lego Manufacturing Vietnam, LMV will be the first manufacturer to introduce the new future factory idea. This global concept will then be customized to fit the local culture and specific needs of the LMV.
Lego builds the second largest factory in Asia.
In March 2022, Lego Group was officially granted a license to invest in a factory project with an investment value of 1 billion USD in Binh Duong province. The factory was built on an area of 44ha in VSIP III industrial park.
This is the 6th factory of the Lego Group globally, the second in Asia and the project with the largest investment capital by a Danish enterprise in Vietnam. The Lego factory in Vietnam is the largest ever investment project of Lego and also the largest factory in Vietnam invested in 2022.
The Lego factory project is expected to be deployed in the second half of 2022 and start operating in 2024.
With the winning bid for Lego’s $1 billion project, Coteccons gave another signal of prosperity after two years of unprecedented difficulty. Recently, Coteccons won the bid for the great Diamond project, the symbol of Hai Phong and won many contracts of great value in the first half of the year.
Before that, Coteccons was under great pressure with 2 years without a CEO. Coteccons’ restructuring process was fraught with difficulties and faced many doubts from both the public and shareholders about its ability to regain the top after the personnel changes at the top.
In 2021, Coteccon’s profit is only 24 billion dong, less than a week at the peak of this business. Difficulties are not over when businesses still have a loss of nearly 24 billion dong in the second quarter of 2022 and an additional trillion dong in debt.
Coteccons is known as a leading enterprise in the field of construction. However, the war within the once largest construction company in Vietnam has caused the capitalization of this enterprise to evaporate tens of trillions of dong. The share price dropped from a peak of about 200,000 VND (adjusted price) at the end of 2017 to less than 50,000 VND/share in early 2020 and in May 2022 before recovering to the current level of 70,000 VND/share.
At Coteccons, the internal conflict was resolved with the ending of the departure of former chairman Nguyen Ba Duong and a series of other leaders at the end of 2020. However, this enterprise has lost its No. 1 position with its growth. of Hoa Binh Construction (HBC) and the emergence of a new competitor: Ricons.
The race in the top 3 construction contractors recently has been fierce. Mr. Le Viet Hai’s Hoa Binh Construction returned to the forefront when Coteccons’ revenue fell by two thirds compared to its peak.
For HBC, in the past 2 years, this business has not prospered in the context of the residential real estate market not having positive movements due to the impact of the Covid-19 pandemic. Profit in 2 years 2020 and 2021 is around 90-100 billion dong, only about 15-20% compared to previous years.
Recently, many construction enterprises eased the pressure after the domestic construction steel price dropped sharply to the threshold of 15 million dong/ton. However, difficulties still exist when some construction materials are still at high prices such as cement… Besides, the construction market has not had many positive changes when the bond market dropped. and recently, the State Bank controls credit in the real estate sector. New construction projects are not as explosive as the previous period.
